Hong Kong Trade Development Council (HKTDC) has lowered its forecast on export growth this year, from 7 percent to 5.5 percent, as the financial storm rages across the world.

"Affected by the financial tsunami, local export will experience a rapid slowdown in the fourth quarter this year. There may be a negative growth in individual months. The financial tsunami triggered by the Lehman Brothers has only started in September, and export performance of this quarter will also be deteriorating," assistant chief economist Poon Wing-choi said in an interview with a local radio yesterday.

Faced with the worsening business environment caused by decreased demand for local products in both Europe and the US amid global economic slowdown, HKTDC has lowered its forecast on Hong Kong's export growth from 7 percent to 5.5 percent.

"Exporters said their sales orders had decreased and slashing prices on goods had been intensified.

According to the previous numbers of orders from Europe and the US, Christmas sales this year have become the lowest in nearly 5 or 6 years. I believe the worst time isn't over yet," Poon said.

Local merchants should grab their chances in the mainland market, Poon added. He also believed that the 4-trillion yuan stimulus package introduced by the central government will help local merchants.

"The correction done in export growth is normal as the economy is facing a downturn," Patrick Shum, executive director at Karl Thomson said.

"The gross domestic product (GDP) figures were released last week and the figures had dropped for two quarters. It showed that Hong Kong had hit a technical recession. The situation may worsen in the near future," he said.

Hong Kong's third-quarter GDP growth figures 0.5 percent from the previous quarter.

(HK Edition 11/18/2008 page2)